Food prices rise again on higher oil prices and adverse weather

Global food prices increased by 8 percent from December 2011 to March 2012 due to higher oil prices, adverse weather conditions, and Asia’s strong demand for food imports, according to the World Bank Group’s latest Food Price Watch.

The World Bank’s Global Food Price Index was only 1 percent below a year ago and 6 percent below the February 2011 historic peak.

If the current forecasts for increased food production do not materialize, global food prices could reach higher levels, underscoring the need to remain very vigilant.

“After four months of consecutive price declines, food prices are on the rise again threatening the food security of millions of people,” said Otaviano Canuto, World Bank Vice President for Poverty Reduction and Economic Management (PREM).

“Putting food first must remain a priority for the international community and in our work in developing countries.”

According to the quarterly Food Price Watch report, prices of all key staples increased between last December and March of this year, except for rice, due to both abundant supply and strong competition among exporters. Maize prices increased by 9 percent, soybean oil by 7 percent, wheat by 6 percent, and sugar by 5 percent. Crude oil prices rose by 13 percent.